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Re: Getting rid of your timeshare (by R P.):

drk14 wrote:

jayjay wrote:

SCAM period .... we've rehashed this many times on these forums .... you can't deduct $5000 on your income taxes if a timeshare is worth zero .... if you do you're breaking the law and it will come back to bite YOU and the people that do business with you.

jayjay, you so right. We have hashed this out several times and each time you continue to ignore what the IRS law states directly. I've posted it for you and others to read.

Why do you continue to display your inability to either read the law or childishly ignore what you don't like?

It's because of opinionated and misguided people like you that so many owners continue to struggle with continued ownership needlessly. Do us all a favor and try going back to read what has been copied directly from IRS publications and IRS law. Then stop unsubstantiated diatribes or show references to what you believe.

For other readers, as jayjay said, all the legal references are already posted near the beginning of this forum thread. Take a few minutes to read what the IRS actually says about donating, valuation, and how to protect yourself in the process.

One more time:

Here's what Dave McClintock, CPA and respected TUG member/moderator says about donating timeshares and any deductibles allowed:

Donating your Timeshare To Charity A frequent question at TUG is, “Should I donate my timeshare to charity?” That often translates to, “I can’t sell my timeshare and have been told the tax benefit may exceed the sales price on the open market.” The answer is "Yes!", if you have a charitable motive and "No!", as it relates to that expected tax benefit.

If donating a deeded timeshare, the deductible contribution amount will normally be equal to the Fair Market Value (FMV) on the date of donation. That’s the price that an arms-length buyer and seller in the timeshare resale market would agree upon, not what the developer is charging for that same week. If the FMV exceeds $5,000, you’ll need a written appraisal that meets IRS guidelines. If the sale of the property would have resulted in a short-term gain, the FMV must be reduced by this amount.

Right to Use (RTU) timeshares and non-deeded points timeshares are tangible personal property to which additional rules apply. If the charity’s use of the property is unrelated to its primary function (for example, if sold at an auction), the FMV must be reduced by the amount of any gain that would have resulted had the property been sold by the taxpayer.

So, why can’t the tax benefit justify a donation? It’s relatively simple. FMV is normally the same as what you would sell your timeshare for. Since the highest federal tax bracket is 35%, you’re better off selling and pocketing the cash. For example, if you sell your timeshare for $1,000 (the FMV), you’ll have $1,000 in your pocket. If you donate the timeshare, your deduction should be $1,000 and your federal income tax savings would put, at most, $350 (35% x $1,000) in your pocket.

Keep in mind that appraisals aren’t cheap (most cost $500 or more) and the cost of the appraisal isn’t considered a charitable contribution.

Another frequent question is, "Can I get a tax deduction if I donate the use of my week to a charity?" The answer is “No”. IRS regulations won’t allow a charitable deduction for the gift of a right to use property. Donate the use of a week because you are charitable, but you can't deduct any value associated with the use of the week.